"Commodity Currencies Slide Amid Risk Aversion"

 

Welcome back to FIVE5! I'm  Holly Leake , and today we have breaking news that could shake up the markets. As of March 2, 2025, commodity currencies are experiencing a significant slide amid rising risk aversion. Let’s dive into the details!

Commodity currencies, including the Australian, New Zealand, and Canadian dollars, have weakened against major currencies during the Asian session on Friday. This downturn follows U.S. President Donald Trump’s announcement confirming that tariffs on Mexico and Canada will proceed next week, alongside an additional 10% tariff on China.

Trump clarified that the previously paused 25% tariffs on imports from Mexico and Canada will take effect on March 4. He also stated that a new 10% tariff on imports from China will be imposed on the same day, adding to the existing tariffs introduced earlier this month. The President claims that drugs are flooding into the U.S. from Mexico and Canada, with a significant portion supplied by China.

In economic news from Australia, total credit increased by 0.5% month-on-month and 6.5% year-on-year in January, according to the Reserve Bank of Australia. Housing credit rose by 0.4%, while personal credit remained flat. Meanwhile, business credit saw a notable climb of 0.7% month-on-month and 8.8% year-on-year.

During the Asian trading session, the Australian dollar fell to a nearly 7-month low against the yen at 92.73 and a 2-week low of 0.8974 against the Canadian dollar. If this downtrend continues, support levels are expected around 89.00 against the yen and 0.88 against the loonie.

The NZ dollar also took a hit, dropping to over a 2-week low of 0.5602 against the U.S. dollar and nearly a 7-month low of 83.67 against the yen. Support levels are anticipated around 0.54 against the greenback and 82.00 against the yen.

The Canadian dollar fell to a 4-week low of 1.4453 against the U.S. dollar and a 5.5-month low of 103.21 against the yen, with support expected around 1.48 and 102.00, respectively.

 

Looking ahead, keep an eye out for key economic data releases! German retail sales and import prices for January, as well as U.K. Nationwide housing prices for February, are set to be released at 2:00 AM ET. In the European session, we’ll see the German unemployment rate for February and ECB consumer inflation expectations."

 

And in the New York session, important data including Canada’s GDP for December, U.S. Core PCE price index, personal income and spending data, and the Chicago PMI are scheduled for publication.

Stay informed and ahead of the curve! For more updates on the economy and market trends, make sure to hit that subscribe button and join the FIVE5 community. Thanks for watching, and we’ll see you next time!

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